The disruptive innovation approach is a theory first developed by Harvard Business School professor Clayton Christensen in 1995.
Disruptive innovation is when a product or service is more affordable, more accessible, and often better performing than existing offerings, so market leaders take their position in the market and transform the industry.
Disruptive innovations also tend to target the lower end of the market, as they focus on areas viewed as less profitable by leading companies or areas for which there is no other alternative.
Three key components are needed to create disruptive innovation:
- Includes a facilitating technology
- Have an innovative business model
- Finds a consistent value proposition
In order to survive the change processes brought about by disruptive innovations, it is necessary to know your company's culture well, to be open to changes and to be flexible in applying new ideas.
Another important issue is to ensure that employees are open to a culture of innovation. The fact that people working in the management side realize the effects of disruptive innovations that will radically change the sector in the future is one of the critical factors that will ensure the survival of the company in the rapidly changing world economy and conditions. In this context, it is important to allow employees at all levels to follow innovations and to carry out innovative work within the company.
Successful examples of being able to develop a disruptive innovation strategy or to develop the right strategies against disruptive innovation are as follows:
- Starting as an online book store only, Amazon has completely changed the entire e-commerce industry.
- Netflix, which offered movie rental services with a post service when it was first established, later moved movies and series to an online platform and changed the media industry.
- WhatsApp, which makes an existing type of communication faster and free, has reached a point where even money can be transferred from customer management.
The reason all this is successful is because companies have their own innovation culture. Another important point is that the company follows the innovations in the field in which it operates. Although such disruptive innovations usually take place in the field of technology and informatics, many radical changes are also occurring in the production and service sectors.